Drinkwater has signed a five-year deal at Stamford Bridge as Antonio Conte ended a largely frustrating transfer window by landing a key target, but Chelsea still remain 5/1 third favourites with Sky Bet to win the Premier League title behind the two Manchester clubs, City who are 11/8 and United 2/1.
Earlier in the evening Barkley was close to completing a move to Chelsea, with a fee of £35million apparently agreed, only for the player to change his mind.
Barkley's U-turn continued a turbulent window for the Premier League champions, who missed out on a host of transfer targets throughout the summer.
Romelu Lukaku, Alex Oxlade-Chamberlain and Fernando Llorente were all wanted by the Blues but instead ended up joining Premier League rivals.
But Conte did manage to add to his earlier recruits with a late move for 27-year-old Drinkwater, who handed in a transfer request earlier in the week.
"'I'm delighted to be a Chelsea player and can't wait to get started. It has been a long journey to get here but I am very happy and am looking forward to helping the club win more trophies," the former Manchester United youngster told chelseafc.com
While Drinkwater completed his move from Leicester, he will not be joined at Chelsea by England colleague Barkley.
Barkley changed his mind about moving to Stamford Bridge despite claims from Everton majority shareholder Farhad Moshiri that he had undergone a medical in west London, although other reports suggest no medical was conducted.
Moshiri said Everton had accepted a £35m offer for the England international and were left "surprised" by Barkley's decision to opt against the move.
The 23-year-old emerged as a late candidate for Conte's side, who have added Antonio Rudiger, Tiemoue Bakayoko, Alvaro Morata and Davide Zappacosta in the window, having been told by Everton boss Ronald Koeman he could leave this summer.
But Moshiri told Sky Sports News the player had a change of heart and will now return to Goodison Park to continue rehabilitation on a hamstring injury.
"After the medical we heard from Paul Martin, Ross Barkley's agent, that he changed his mind and wanted to reconsider his position during the January window, that is the latest," he said.
"He is currently injured so I think technically he will be with us because he is under contract for another year. So it is a big surprise, but that is football."
Someone who will play alongside Drinkwater at Chelsea following his own last-minute deadline day move is Italy international Zappacosta.
The 25-year-old defender joins from Torino and has signed a four-year deal at the club.
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